Front Matter

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African Department

Front Matter Page

Copyright © 2015

International Monetary Fund

Cataloging-in-Publication Data

Strengthening the West African Economic and Monetary Union/Olivier Basdevant … [et al.].–

  • Washington, D.C. : International Monetary Fund, 2015.

    • pages ; cm – (African departmental paper)

  • Approved by the African Department.

  • Includes bibliographical references.

I. Basdevant, Olivier II. International Monetary Fund. III. International Monetary Fund. African Department. IV. Title: Strengthening the West African Economic Monetary Union: The Role of Fiscal and Market Institutions in Economic Stabilization. V. African departmental paper.

October 2015

ISBN: 978-1-51356-7-334 (paper)

The African Departmental Paper Series presents research by IMF staff on issues of broad regional or cross-country interest. The views expressed in this paper are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

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We would like to thank the WAEMU authorities, participants to the IMF Fiscal Network seminar, and Messrs. Mark De Broeck, Xavier Debrun, and Ivohasina Razafimahefa (all FAD), and Hervée Joly, Christian Josz, and Roger Nord (AFR) for very useful discussions and suggestions. Douglas Shapiro, Monica Snyder, and Graham Colin-Jones provided excellent research and editorial assistance. This paper was prepared when Huy Nguyen was a summer intern in the African Department of the International Monetary Fund (IMF).

The authors can be contacted at,,, and


  • I. Executive Summary

  • II. Strengthening WAEMU Fiscal Rules

    • A. The 2014 Reform of WAEMU Fiscal Rules

    • B. Options to Strengthen Rules at the National Level

    • C. Options to Enforcement Mechanisms at the National Level

  • III. Creating Public Insurance Mechanisms

  • IV. Developing and Strengthening Financial Insurance Mechanisms

  • References

  • Box 1. Fiscal Rules in WAEMU Convergence Criteria

  • Box 2. Risk-Sharing and Regional Fiscal Stabilization Fund

  • Figure 1. Experiences with Fiscal Rules in the WAEMU

  • Figure 2. Number of Countries with Fiscal Councils, 1960–2013

  • Figure 3. Frequency of Asymmetric Shocks in the WAEMU

  • Figure 4 Shock-Smoothing in the WAEMU

  • Figure 5. Shock-Smoothing with a Centralized Mechanism

  • Figure 6. Cross-border Bank Liabilities in the WAEMU, 20121

  • Table 1. Banking Union in the WAEMU

Strengthening the West African Economic and Monetary Union: The Role of Fiscal and Market Institutions in Economic Stabilization
Author: Olivier Basdevant, Patrick A. Imam, Mr. Tidiane Kinda, and Ms. Aleksandra Zdzienicka